HDHP-related deductibles too costly for many families
Costs could be thousands per year
Many uninsured households can't afford the out-of-pocket costs associated with health savings account-qualified high-deductible health plans, according to a recent study by the Kaiser Family Foundation.
The study's authors found that fewer than half of households with one uninsured member had sufficient assets to cover an HSA-related deductible of $1,000; fewer than one-third could cover a deductible of $2,364; and fewer than one-quarter could cover an out-of-pocket cost limit of $5,000.
The percentages were even lower for households with two or more uninsured members, the study found.
"Although the premiums for HDHPs are more affordable than those for more comprehensive policies, HDHPs also expose enrollees to thousands of dollars in annual financial risk," the study's authors said. "This raises the question of whether lower-income families can afford to pay the relatively high cost-sharing required by these policies if a serious illness arises."
In another study, the actuarial consulting firm Milliman Inc. found that consumer-directed health plans reduce costs by only 1.5% after adjusting for their higher cost-sharing and healthier members.
The firm analyzed data from six employers with roughly 30,000 employees enrolled in consumer-directed health plans high-deductible plans with access to a funding account. Few of the enrollees had access to information on the cost or quality of health care providers, the employers indicated.
Without such information, the authors concluded, CDHP savings are likely to remain limited to the reduced utilization expected from high-deductible plans.
Many eligible for help don't use public programs
Need for outreach, simplification cited
One in four people who lack health insurance in America are eligible for public insurance programs but do not enroll, including 64% of uninsured children, according to a recent report by the National Institute for Health Care Management Foundation.
Possible solutions include increasing outreach and education activities, simplifying eligibility determination, and facilitating the enrollment and re-enrollment processes, the report states.
Options for insuring those who are not eligible for current public programs include expanding public programs and strengthening private market options, the authors add.
"Key policy decisions around expanding public coverage include which additional categories of people should qualify and what income level should be used to determine eligibility," the report states. "Selecting an appropriate income threshold requires making judgments regarding the affordability of health insurance, and is greatly influenced by political and fiscal realities."
In a related development, a study on Medicaid and the uninsured released by the Kaiser Foundation found that a one percentage point rise in the national unemployment rate would increase Medicaid and State Children's Health Insurance Program enrollment by 1 million and cause the number of uninsured to grow by 1.1 million.
"As a new economic downturn unfolds, many states appear headed for serious budget shortfalls," states the study, prepared by researchers at the Urban Institute. The states' fiscal problems "warrant serious consideration as part of an ongoing national strategy to minimize the duration, severity and consequences of economic downturn," the study adds.
The poor health and shorter lifespan of the uninsured cost the U.S. economy between $102 billion and $204 billion in 2006, according to an earlier report by the New America Foundation.
That's at least as much as the public cost of covering them, and does not include the cost to society when medical bills go unpaid, the authors said.
That report updates estimates reported by the Institute of Medicine in 2000 to reflect growth in the economy and the number of uninsured.
An estimated 43.7 million U.S. residents were uninsured when interviewed during the first nine months of 2007, up from 43.6 million in 2006, according to the Centers for Disease Control and Prevention.
Based on the CDC's National Health Interview Survey, the estimate includes 6.8 million children. An estimated 54.5 million residents were uninsured for at least part of the year prior to the interview, and 31.2 million were uninsured for more than a year, up from 30.7 million in 2006.
An estimated 17.5% of privately insured respondents in that survey were enrolled in a high-deductible plan and 4.5% were enrolled in a consumer-directed plan.
Many uninsured households can't afford the out-of-pocket costs associated with health savings account-qualified high-deductible health plans, according to a recent study by the Kaiser Family Foundation.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
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